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Kitzhaber’s resignation invites new scrutiny over Oregon’s disastrous health care exchange

Before leaving office, Oregon Gov. John Kitzhaber (D) will have to produce documents to Congress. (AP Photo/Gosia Wozniacka)

House Republicans are using the resignation of embattled Oregon Gov. John Kitzhaber (D) to reexamine one of the most troubled state-based health care exchanges in the country.

In a letter to Kitzhaber’s office sent Friday, Republican members of the House Oversight and Government Reform Committee asked Kitzhaber’s administration to produce documents related to Cover Oregon.

Republicans cited reports last week that an official in Kitzhaber’s administration sought to destroy e-mails from the governor’s personal Gmail account. Those e-mails apparently had to do with first lady Cylvia Hayes, whose outside business dealings blurred the line between her private clients and official state business. Hayes is the subject of multiple investigations, being conducted by both the state attorney general’s office and the FBI, over whether she broke state ethics rules and laws and whether she failed to pay income taxes.

But the committee wants to know whether the e-mails include any hints about the Cover Oregon fiasco. In the letter, committee chairman Jason Chaffetz (R-Utah) and subcommittee chairmen Jim Jordan (R-Ohio), Mark Meadows (R-N.C.) and Will Hurd (R-Tex.) seek all communication from the governor’s office regarding the health exchange and the Affordable Care Act, along with phone and meeting records.

Cover Oregon was one of the most flawed state-based exchanges set up after passage of the Affordable Care Act. The state spent more than $240 million on outside contractors who built the site, mostly through lead contractor Oracle. But it flopped so badly that state officials decided last year to scrap it entirely and route Oregonians looking for health insurance through the federal Web site.

Oracle and Oregon filed dueling lawsuits. Oregon says the company cost the state more than $420 million, including payments to other vendors, and Attorney General Ellen Rosenblum (D) asked a state court to award Oregon $5.5 billion in damages. Oracle countersued, seeking $23 million in unpaid debts owed by the state.

E-mails obtained by Willamette Week, an independent weekly in Portland that’s broken several major stories about Kitzhaber and Hayes, showed many of Kitzhaber’s explanations for Cover Oregon’s failures — and even discussions over settlement talks with Oracle — came from aides working for Kitzhaber’s reelection campaign. The paper reported that Kitzhaber’s consultants were behind the decision to shutter Cover Oregon and move to the federal Web site.

Last week, Kitzhaber’s executive assistant asked Oregon’s Department of Administrative Services, which maintains state data, to destroy any e-mails from the governor’s private e-mail address removed from state servers. The request landed a day before Rosenblum opened her investigation into Kitzhaber and Hayes. DAS refused the request.

Oregon’s unusually strong open-records laws allows access to e-mails to or from state officials that involve official business, even if they originate from or go to private e-mail addresses. Hence Kitzhaber’s e-mails to his political consultants and even the request to delete those e-mails quickly became public.

Amid the mounting ethics scandal, Kitzhaber tendered his resignation Friday. He will be replaced by Secretary of State Kate Brown, who will take the oath of office Wednesday morning in Salem.